MEANING

Determining the future course of action

Why? How?
What? When?
Setting goals & defining the actions necessary to achieve those goals.
A process that involves defining the Organisation goals, establishing an overall
trilogy for achieving those goals & developing a comprehensive set of plans to
integrate & coordinate organizational work.
Plan is a blueprint for action that prescribes activities necessary for the
Organisation to realize its pals.
PLANNING AS A LINKING PROCESS

GOALS PLANS CONTROL

 Definition of Planning
“ Is the selection & relating of facts & making and using
assumptions regarding the future in the visualization &
formalization of proposed activities believed necessary to
achieve desired results”

“Planning is deciding in advance What to do, how to do it, when

to do it and who is to do it. Planning bridges the gap from where
we are to where we want to go”- Koontz & O’Donnell.
 Process

Flexible Future Oriented

Features of
Planning
Continuous Selection of suitable
course of action

At all levels of
Organisation

Nature Of Planning
• Rational approach • Open system approach • Pervasiveness
 Characteristics of Planning

Constitutional
Features
• Planning is Goal oriented
• Planning is Future • Planning is all pervasive
Oriented Operational • Planning is both short
• Planning is a primary Features range and long range
function • Planning is continuous
• Planning is an intellectual
process

• Planning is actionable
• Planning is flexible
Desirable Features
• Planning is an integrated
system
 Importance of planning

• Primacy of planning
• To offset uncertainty and change
• To focus attention on objectives
• To help in coordination
• To help in control
• To increase organizational effectiveness
 Planning Process

Step-1 Step-2 Step-3

Being aware of Setting objects & goals. Considering Planning
opportunity. In light of market, Where we want to be, premises, in what
competition, our strength, What we want to Internal or External our
our weaknesses. accomplish,
plans well work
When

Step-4 Step-5
Comparing alternatives in light Step-6
Identifying alternatives what Choosing an alternative
are the most promising object of goals sought which alternative
well give us the best chance of selecting the course of
in accomplishing our ….. action we will pursue.
meeting our goals at the
lowest cost & highest profit.

Step-7
Step-8
Formulating supporting plans
Numberzing plans by making budgets
Plans as to: buy equipment
Develop such budgets as volume & price of sales
buy materials
Op.exp necessary for plans Exp.for capital equipment.
Hire & train workers
Develop new product.
SWOT
 Types of Planning

• Corporate / Functional planning [ coverage of activities]

• Strategic / Operational planning [ Importance of contents]
• Long – term & Short - term planning [ Time period goals]
• Proactive & Reactive planning [ Approach adopted]
• Formal & Informal planning [ Degree of formalization]
 Strategic & Operational Plans

Strategic Plans: Plans that apply to the entire organisation, establish the
organisation overall goals & seek to position the organisation in terms of its
environment.
Operational Plans: Plans that specify of how the overall goals are to be achieved.

Standing & Single use plans

Standing Plans: Ongoing plans that provide guidance or activities performed

repeatedly.
Single use Plans: A one time plan specifically assigned to meet the needs of a
unique situation.
Types of Plans

Mission
or
Purpose

Objectives

Strategies

Policies

Procedures & Rules

Programmes & Projects

Budgets

Quotas & Targets

 POLICIES
• Policies are general statement that guide managers in
decision making.
• Policies provide a basis for interpreting strategy which is
usually stated in general terms
• Policies help managers to tackle issues before they
become problems

PROCEDURES
Procedures provide step-by-step directions that explains how activities
or tasks should be carried out to enforce a policy and to attain pre-
determined objectives.

They may even include a checklist or process steps to follow.

At the very least, your procedures should outline the following

information: Who is responsible for each task, What steps need to be
taken, and Who the responsible party reports to.
 RULES
• Rules are specific statements that tell an employee what
he or she can and cannot do
• Are do & don’t statements put in to place to promote the
safety of employees , uniform treatment and behaviour
of employees

Programs & Projects

Programmes are detail statements about a project

Budget
A budget is a statement of expected results expressed in numerical
terms.
Barriers to Effective Planning

• Demands on the Mgrs time

• Resistance to change
• Ambiguous & uncertain operating environment
• Cost factors

Overcoming the barriers

• Involve employees in decision making

• Tolerate diversity of views
• Encourage strategic thinking
 Features of Good plan

• Linked to long-term objective

• Direction for action
• Consistent
• Feasible
• Simplicity
• Flexible
 Mission & Purpose

The purpose or Mission of an organisation is a enduring steps of the organisation

the extent of which embodies the decision makers philosophy. It implies the image
which the organisation seeks to project.

Formulation of Mission

Key decision Makers Visionary

Organisational Mission
Philosophy Long term concept of Org.

Components of a Mission statement

• Customers • Products or services • Markets
• Technology • Concern for survival • Philosophy
growth & profitability
• Self concept • Concern for employees
• Concern for public image
 Characteristics of a Mission statement

• Clear • Self Explanatory

• Flexible • Distinctive
Godrej
Vision:- Godrej in every home & work place
Mission:- Enriching quality of life everyday every where
Values:- Integrity / Trust / To serve / Respect / Environment
MUL

Vision:- The leader is the Indian automobile creating customer delight &
share holders wealth A pride of India.
Our core value:- Customer orientation, Network partnership Fast, Flexible &
fast moves, openers & Learners, Innovation & creativity.

Our Quality Cons. Satis through continuous improvement of our plans &
Policy:- services by following PDCA [Plan-Do-Check-Act] in all
functions of our organisation.
 Objectives

Objectives are goals established to guide the efforts of co & each of its
components.

Hierarchy of objectives

Overall
Objectives

Divisional

Ends
Means
Objectives

Departmental
Objectives

Individual
Objectives
Importance of Objectives

• Legitimacy • Direction • Coordination

• Benchmarks for success • Motivation
 General targets to be accomplished
GOALS
[A future target or end results that an organisation wish to accomplish]

Objectives End point of a Management programme.

Singular

What is to be Specific
accomplished in
Measurable terms

Target date
Singular
To increase sales…….by 25% and to achieve 10% Market share
To increase sales…….by 25% by dec2013 and to achieve a 10% Market
share of……during 2014.

Specific
To maximum profits in 2014
To earn net profit of $1million in 2014
Measurable
Perfect service for every cost.
To attain 70% cost ‘excellent’ satisfactory rating for 2013

Target date
To become a multimillionaire
To become a multimillionaire by December 2016

Writing Objectives Model

Four parts of the Model

Infinitive Action Verb Singular, Specific Target date

& measurable

To Increase Sales to 50% of….in the…..by…..

 Traditional Objective Setting

I want to see significant We need to improve the

improvement in this co’s performance
divisions
profit
Top Mgt’s
objective

Division Mgr’s
objective
Don’t worry about Increase profit
the quality just Department Mgr’s regardless of work
work fast objective

Individual employee’s
objective
 Management By Objectives [MBO]

Peter Drucker first used the term "management by objectives" in his 1954 book The
Practice of Management.

“MBO is a comprehensive managerial system that integrate many key managerial

activities in a systematic manner, consciously directed towards the effective &
efficient achievement of organisational objectives”

Odiorne defined MBO as a system of managerial leadership in which the superior

and subordinate managers of an organization jointly identify its common goals and
jointly set performance objectives to meet those goals.

Goal specificity
Participative decision
Features
An explicit time period

Performance feed back

 Process
Organisation purpose Planning
& objects Premises

Key Result areas

Superiors objective

Superiors recomm. for Sub-ordinate stat of

subordinates object his object

Sub-ordinates agreed
Matching results
objective

Sub-ordinates
performance
 Benefits of MBO

• Better overall Mgt & achievement of higher performance levels

• Effective overall planning systems
• Forces Mgrs to establish priorities
• Clarifies specific role, responsibilities and authority of personal
• Creates participative environment
• Facilitates process of control
• Lets individual know what is expected of them
• Objective basis for performance appraisal
• Improved communication
• Facilitates the organisation ability to change
• Increases motivation & commitment of employees
 Problems

• Time & Cost

• Emphasis on short term objectives
• Inflexibility

• Complicating administrative process

• Difficult to establish
• Frustration